Is China Buying Up All of America’s Natural Gas?

October 26, 2022 Topic: China Blog Brand: Politics Tags: ChinaUnited StatesNatural GasEnergyChinese Communist Party

Is China Buying Up All of America’s Natural Gas?

The increased rate at which Chinese companies are buying up American natural gas has sparked considerable concern among lawmakers.

Chinese energy companies have been found to be the fastest-growing customers of U.S. natural gas exports, buying up nearly half of all gas that companies agreed to ship in the past year.

According to a new Politico report, this is sparking worries among some Washington lawmakers.

“Some of those firms are working against U.S. interests—dealing in oil from sanctioned countries, drilling in areas notorious for human rights abuses or helping the Chinese military capture contested territory from its neighbors,” the news outlet writes.

“As tensions between Washington and Beijing rise—and high natural gas prices squeeze American manufacturers—lawmakers from both parties are calling for the White House to consider new limits on the gas sales to China,” it continues.

These concerned lawmakers want more Chinese energy companies to be added to a trade blacklist and for the Biden administration to close any loopholes that could be taken advantage of.

In one example, the Chinese National Offshore Oil Corporation, which was put on a trade blacklist by the Trump administration in 2021, was able to sign its first-ever deal with a U.S. gas exporter less than a year later. The firm agreed to purchase 3.5 million tons of natural gas annually over the next two decades—more than enough to heat every home in Massachusetts each year, Politico reported.

“I am increasingly concerned by the considerable public reporting that energy companies controlled by the [Chinese Communist Party] are threatening U.S. national security and foreign policy interests,” said Rep. Michael McCaul (R-TX), the top Republican member on the House Foreign Affairs Committee.

Similar sentiments were shared by Senate Intelligence Committee Chairman Mark Warner (D-VA). Commerce “should be reviewing these transactions to determine whether these companies should be added to the [trade blacklist],” he said.

Meanwhile, Sen. Marco Rubio (R-FL), the panel’s top Republican, added that “any company connected to the CCP merits extra scrutiny by American regulators.”

According to Michael Catanzaro, an energy adviser to former President Donald Trump, Republicans in Congress could “latch onto” the gas export issue after next month’s midterm elections.

“There is some concern being expressed about the U.S. exporting LNG to China, with the thought of why are we sending our energy to a geopolitical adversary?” he said during a natural gas industry event on Tuesday, per Politico.

However, Catanzaro noted that there could be geopolitical benefits in continuing to trade with China.

“Certainly China taking our energy is a good thing from a national security standpoint,” he said. “We see what happens when countries have leverage over other countries with respect to energy.”

Sen. Bill Cassidy (R-LA) added: “I don’t see China buying LNG to replace coal fired plants necessarily aiding and abetting Russia.”

Ethen Kim Lieser is a Washington state-based Finance and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.

Image: Reuters